Board of Directors Meeting Minutes: November 2024

These are the minutes of the Brattleboro Food Co-op Board of Directors meeting Monday, November 4, 2024

Present

Directors Present: Kevin Brennan, Calvin Dame, Denise Glover, Lee Halpern, Anneka Kindler, Michele Meulendyk, Evan Silber [Zoom], Sheena Tesch, and Johanna Zalneraitis.

Staff, Shareholders, and Others Present: GM Anthony Santorelli, Director of Accounting and Finance Mudith Kalutota, and Board Administrator/Sustainability Coordinator Sarah Brennan.

President Michele Meulendyk called the meeting to order at 5:15 pm.

1. Welcome

Michele welcomed new Board members Lee and Sheena. Board members provided examples of times when they valued seeing communication norm #1 (“Respect our collective wisdom. No one knows everything, each of us knows something, and together we know a lot.) in action.

2. Shareholder Input

1. The Board reviewed recent receipt surveys. Comments on prices suggest possible topics for Board Food for Thought articles, such as the realities of running an independent grocery store.
   
2. The Board reviewed shareholder statistics. Discussion touched on the pool of donated hours (what are we doing to communicate their availability? What are the trends over time in how those are used?), why not all employees are shareholders (this is a function of when they were hired), and time frames covered by the statistics (generally as close to the calendar month in question, given the packet release deadline).
   
3. Going forward, to make trend-spotting easier, we will add columns for previous month gross sales and planned sales to the new section on gross sales, transactions and basket size.

3. Approval of Minutes

1. Anneka moved and Denise seconded to approve the minutes from the October 14, 2024 meeting. Discussion: none. The motion to approve the minutes carried unanimously with 2 abstentions (Lee, Sheena).
2. Denise moved and Johanna seconded to approve the minutes from the October 21, 2024 meeting. Discussion: none. The motion to approve the minutes carried unanimously with two abstentions (Lee, Sheena).

4. Monitoring Reports

1. C.1 Board/Management Relations
   1. Denise moved and Kevin seconded to approve the monitoring report for C.1 Board/ Management Relations.
      
   2. Discussion: Michele noted that Policy C.1 clarifies that the only connection between the Board and operations is through the GM, and through Board policies. Policy B.7.3* overlaps with this one. She’ll be working with Sarah to refine standard boilerplate language in monitoring report surveys.
      
      *B.7.3 Non-Compliance – Board: The General Manager shall not fail to advise the Board if, in the opinion of  the General Manager, the Board or any of its members is in non-compliance with the policies on Board Process or Board/General Manager Relationship
      
   3. The motion carried with two abstentions (Lee, Sheena).
2. C.2 Delegation to the GM
   1. Anneka moved, and Denise seconded, to approve the monitoring report for C.2 Delegation to the GM.
      
   2. Discussion touched on the following points: Reasonable interpretation – a GM’s interpretation of a policy can be deemed reasonable even if all the Board members have a different interpretation. Power dynamics – Board members need to be mindful when interacting with staff to not give the impression that they have any authority over staff (they do not). Hierarchical structures – the Board’s relationship with the GM, the organizational structure of reporting relationships among the staff, and the contract with the union are all examples.
      
   3. The motion carried with two abstentions (Lee, Sheena).
3. B.2 Financial Condition and Activities
   1. Kevin moved and Johanna seconded to approve the monitoring report for B.2 Financial Condition and Activities. Discussion: No concerns were expressed about either the interpretation statements or the compliance data. Suggestions were offered for providing more context about the ratios, such as whether they are trending in a desired direction.
      
   2. Comments touched on the following:
      • Overview: We missed sales and therefore the associated margin dollars. We performed well on margin as a percent of sales. Expenses reflect the pre-holiday inventory build-up, some of which we are able to store at the Retreat Farm. This helps our margins.
        
      • Working Capital: Because of sluggish sales, our working capital continues to shrink – more cash is going out than coming in. If this trend continues, it will affect us. Most of our cash came from COVID relief funding. Payroll is $110K/week. Accounts Payable is about $250K/week.
        
      • Reforecast: We’re taking into account the reduction in sales, which drives everything from wages to supplies. The original plan called for a $100K loss for FY25. We are now projecting a loss of $130K. We also adjusted for the contractually-mandated wage increase for union members, which most managers also received. It’s based on a 5-year rolling average of the CPI (consumer price increase) for our region. We had budgeted for 3.25% but that average turned out to be 3.8%, which represents close to $30K. We also factored in slightly higher margin rates.
        
      • July Boiler Explosion: Resulted in 1.5 days in lost sales as well as added expenses. We’re still working with the insurance company to claw back some of those dollars. We feel we are owed $10 -15K on labor, and the margin rate and how they applied it.
        
      • Catering: This is a small, but growing, percent of our revenues; it has a separate (and higher) margin than the retail operation. We’re already booking out as far as September 2025 and filling up every weekend in 2025.
        
      • Debt: Shareholder Loans were an important part of financing the construction of this building twelve years ago; over the past three years we’ve paid them down to $408K. We continue to pay down other debt and aside from a refinance of our loan from CFNE (Cooperative Fund of the Northeast) in April, we have not taken on new debt.
   3. The motion carried unanimously with two abstentions (Lee, Sheena).

5. Board Committees:

Michele noted that the Board will focus on committees at the upcoming retreat and encouraged Board members to begin thinking about what committee they may wish to serve on.

1. Shareholder Engagement: Anneka shared a document intended to serve as building blocks for the 2024-25 charter, noting that the committee would focus on shareholders rather than shareholders + the broader community.
   
2. Board Recruitment: Calvin noted that all Board members are responsible for identifying people who might be a good fit for the Board; the committee is tasked with following up on leads.
   
3. Annual Meeting: In the interests of time, the Board did not take up brainstorming ideas for the 2025 Annual Meeting. This might instead happen at the committee level. Michele explained that the committee consists of two Board members and some staff.
   
4. Training: Denise shared her experience attending the in-person version of Columinate’s CBL 101. Michele called attention to the upcoming four-part series “Explorations in Policy Governance.”

6. GM FYI Update:

Anthony shared updates since the packet went out.

1. VT Dept of Health inspection: We got a score of 99 on an inspection of the seafood department, the deli, and the café.
   
2. Disintegrated drain pipe: We’re investigating a potential fix as well as whether insurance will cover the expense (could be $25 to 30K).
   
3. E-shelf tag demo: We are further evaluating this in light of learning that the demo itself is by no means free as had been originally communicated to us.
   
4. Employee Stay Survey: The Board could see a summary of the results as early as the December Board meeting.
   
5. Green Team: a handful of staff interested in all things sustainability; they meet monthly.
   
6. BFC Cares: This group is not yet established as a stand-alone non-profit. Discussion touched on how it would be held accountable to the GM. Currently, it is not clear where BFC Cares Round Up funds are going.
   
7. Windham and Windsor Housing Trust (WWHT): Shared expenses are being reviewed and updated; the condo association has $138K available to cover expenses, including capital improvements. The budget for 2025 is expected to be finalized in early December.

7. Upcoming Monitoring Reports:

Michele stated that the Board will explore how to do effective monitoring at the upcoming retreat.

She referred to the decision tree included in the packet and noted that there are avenues to request more information from the GM while still approving a monitoring report.

She called attention to upcoming policies being monitored: B.5 Continued Operations, C.3 GM Job Contribution, and C.4 Monitoring Management Performance and noted that an archive of monitoring reports is available on the Board’s site.

8. What Would You Tell a Shareholder?

Meeting participants shared what they would tell a shareholder about this meeting. These comments are shared in the staff newsletter and in Food for Thought.

The meeting was adjourned at 7:42 pm.
Respectfully submitted,
Sarah Brennan, Board Administrator/Sustainability Coordinator